How have OTT platforms become one of the most important users of cloud computing

With technology advancing every day, the way content is being consumed has taken an exciting turn. OTT is the new industry jargon and it stands for “over-the-top”. The term is used for media delivery or streaming services such as film and TV content via the internet, unlike traditional cable or satellite pay TV packages. Netflix, Hulu, Amazon Prime, and Hotstar are great examples.

Growing Demand for OTT Media

In recent years consumer behavior for media consumption has changed dramatically. Whether from entertainment or marketing perspective, video has become an inseparable and valuable part of our lives. People spend a lot of their time watching online videos and also share them with friends and family.

There are some staggering video consumptions stats which speaks volume

  • People spend almost one-third of their online activities watching videos
  • YouTube has almost one-third of total internet users, over a billion users,
  • Every single day, over 5 Billion videos are watched on YouTube.
  • The age group 25-34 (millennial) the most online videos and men spend 40% more time than women watching videos on the internet.
  • According to Zenith’s report, globally, consumers will spend 84 minutes a day watching online video in 2020, up 25% from 67 in 2018.

According to an A.T. Kearney report, the total Pay-TV subscription has declined by 6% from 2014 to 2017 while OTT has seen 80% growth.


Need for Cloud Computing

With this huge jump in the OTT consumer and growing demand worldwide, consumers want more options, convenience, and control over their video viewing. They want more flexibility in scheduling, lining up videos, live events, and recording their favorite shows. For service providers, this means the requirement of more resources, computing power and infrastructure scalability to cater demands.

For a better viewing experience, OTT broadcasters should be able to provide intuitive online video player for the consumers, a robust Content Delivery Network (CDN), algorithms and technology for efficient data compression and on top of that the ability to analyze the huge amount of data.

Traditional physical hardware is limited in providing the required flexibility in computing power, content processing, and distribution. Cloud computing becomes the obvious option as it is very flexible to scale, accelerate processing, distribution and highly cost effective.

OTT Platforms Growth

There are different types of OTT contents such as television, instant messaging and voice calling. OTT platforms for video streaming, especially in developing countries such as India, have seen tremendous growth in 2018.

The second screen has become an important source of entertainment. Globally, the OTT industry is exploding. From a revenue of $6.1 billion in 2010 to roughly $46.5 billion in 2017 is a sizable growth. That number is expected to rise to $83.4 billion by 2022.

According to technaivo, the global OTT market will be growing at a CAGR of over 17% in 2018 – 2022 with an incremental growth of $64.12 Billion.

This huge OTT market has bought a paradigm shift in the way technologies are being used to develop the platforms. Cloud computing is catalyzing the growth of broadcasters and marketers by providing a smooth technological ecosystem development. Globally, OTT industry has seen a big jump in the number of platforms in recent years. According to a BCG report, the number of players in the Indian OTT market had grown from 9 in 2012 to 32 players in 2018.

Land of Opportunity

Global OTT territory is very fragmented, but it a greenfield. Based on the video viewing habits, a lot of opportunities exists for different segments and untapped territories. Currently, the major usage of these platforms is in the entertainment industry and due to its lightning fast information delivery capability, it can be easily used in classroom learning. Many new entrants are setting their foot in multiple different areas such as personalized viewing experience, in house quality content, advertising yet big opportunity exists.

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